kayak at a very high price. of course, all the other stocks in that sector immediately get clubbed. give me a break. expedia is a good company. i'm jim cramer and i'll see you tomorrow. larry, what you are looking at tonight? this is "the ud lkudlow report. now that he's been re-elected, tomorrow president obama will finally tackle the fiscal cliff in a delivered statement. we are going to get you the details. there's been a 400-point-plus selloff since the election. we could be staring at a dividend tax and a capital gains tax hike. superstar investor ken hebner tells us how to get through this period. also, american drone and international airspace days before the election and kept secret until now. is that a coincidence?

and on election day, voters in two states allowed recreational use of marijuana. is this the gateway to liberals legalizing rampant drug use in this country? janine turner is going to join us. within the hour, word that president obama will make a statement on the fiscal cliff and the economy at 1:00 p.m. tomorrow. the congressional budget office issued a new scenario of what happens if the president and congress fail to act. eamon javers joins us now with the details. good evening, eamon. >> reporter: good evening, larry. as you say, we're getting news tonight we're going to get dueling appearances tomorrow between speaker john boehner and president barack obama. the speaker will address a crowd of reporters at 11:00 in the morning. he will take questions from the press. we're told obama will speak at 1:00 in the east room of the white house and will not take questions from reporters. there will be an audience there, but he will not be taking questions. meanwhile, we're getting this report out today from the cbo, which is laying out the scenario of just how bad things would be if we go over the fiscal cliff.

let me give you a couple of the key bullet points here. the cbo saying if we go over the cliff the gdp would drop by 0.5% in 2013. it could decline in the first half of the year, but then renewed growth later in the year. and the unemployment rate would rise to 9.1% if we go over the fiscal cliff, but ultimately the cbo saying unemployment would decline to 5.5% by 2018. so, larry, this sets the backdrop for the dueling appearances between boehner first then president obama later in the day. tomorrow the question is, can these two men come back to the deal they were doing in the summer of 2011 and cab they get anything to agree between the two of them that their relative parties would actually agree to in congress, larry? >> that's the most movement we've seen, eamon, in quite a while. >> reporter: absolutely it. seeing a shift in tone in washington since the election. much more conciliatory tone on all sides here. i expect you'll see that on

display tomorrow. the question is whether the fundamental stumbling blocks of democrats not wanting entitlement spending cuts and republicans not wants new tax revenues, whether those stumbling blocks can be finessed between now and the end of the year. >> many, many thanks. eamon javers, appreciate it. let's get first reaction from congress on the breaking news. welcome back to the show house gop chief deputy whip peter roskam from the great state of illinois. peter, great to see you as always. a lot of movement now. i want to ask you, do you think it's possible here, post-election, as the stock market literally hammers washington with the selloff? will democrats and republicans rise above partisan politics and get us something that can work? >> i think that there's a tremendous opportunity, larry, and here's why. speaker boehner, yesterday, gave a statement, a 10 or 12-minute statement and offed his sincere congratulations to president obama. and he said, look, we're willing to talk about more revenues. these are revenues that we think that can come as a result of a

growing economy and the house has already acted on one proposal that says move forward and extend the current tax rates for one more year and use that as a bridge to tax reform. now, before there were voices on the democratic side that were saying, well, let's just go over the fiscal cliff. well, that's a bucket of crazy. nobody wants to go over the fiscal cliff. it's ridiculous. >> certainly that's one of the stock market, right, post-election. it's an important point you made, mr. boehner saying revenues could be on the table. is that a republican concession? and if it is a republican concession, what do you all want from the democrats as their concession? >> well, i think it's how these things are characterized. many times. you know, in the debate between mitt romney and barack obama, obama laid out this notion that somehow romney was not in favor of any more revenues and romney debunked that and said, look, we're in favor of revenues, and i think he was largely speaking for the republican party at that point. we're in favor of more revenues. the ryan budget, for example, had revenue assumptions in it.

so i think what's got to happen is that both sides have to let the other team take a victory lap. let republicans come into this debate where we keep tax rates low and reasonable and predictable and drive toward tax reform next year. democrats can come into the debate and claim a victory and say, well, we're interested in more revenues. the key is, can we get to these underlying situations and that is entitlement reform. that's where the action is. >> okay. but how realistic is it to postpone or extend everything for a year? as i understand it, this was in the "wall street journal" editorial page this morning and i've heard this elsewhere, that mr. boehner would like to just extend the tax cuts and i don't know what you all are going to do about spending. nobody ever wants to cut spending. is that realistic? is that a bridge? in other words, put it off, give yourself a full year, 2013, and a vo avoid the catastrophe right in the next 50 days. >> yeah, if it's realistic. here's why. president obama in december of 2010, this exact same time, extended these rates one time

already. so the best predictor of future behavior is past behavior. >> but he ran against it, peter. pardon me for interrupting. he ran against it pretty explicitly. >> oh, look, the -- >> chuck schumer has been saying, you know, this -- or harry reid, you know this, harry reid saying this was a mandate to raise marginal income tax rates. that's what they're saying. what's your response? >> the ft. has said all kinds of things, right? he said he was going to close guantanamo, said he was going to do comprehensive immigration reform in the first year, said he was going to cut the deficit in half and go through the federal budget line by line. set that all aside, his flowery rhetoric he newsed to pump up his base. the reality is barack obama signed a law in the past to extend these rates. i predict he will do it again simply because the house is not going to pass a tax hike. it's just not going to happen. and in the words of harry reid who many times over the past several months has said, let's focus on things that the house, or that the senate can actually do. let's focus on something that

can actually pass the house. >> what happens? do we have a powwow? w how does this play out? the clock is ticking. is there a powwow? do you stet up a process or is it boehner, obama and reid? how's this work, peter? >> procedurally, what ends up happening is these three men need to come to an agreement and i would argue the sooner the better. there's no percentage in dragging this thing out and playing the countdown type of drama. there's nothing good that's going to happen there. i think they need to agree in principle. look, and the house has been working over the past two years on a tax reform agenda that is focused in on one word, and that is competitiveness. that's been led by dave camp as chairman of the weigays & means committee. this is teed up and the country is dissatisfied with current tax code. it's an incredible opportunity

for everybody to come together. i'm not here pumping sunshine tell you it's easy. what i'm saying is there's a unique opportunity to bring people together because nobody in their right mind should push us over this cliff. >> last question, quickly if you will. look, the president in his victory speech the other night said, deficit reform, he said tax reform, sbientitlement refo immigration reform. let's just do deficit and tax reform. do you believe that he is being sincere? do you believe that for whatever reasons and motives there's a new era coming in washington? >> i choose to hope that he is sincere, and the proof will be if how he chooses to lead. i know that he's got a willing speaker of the house that's willing to work on a good faith basis with the president of the united states. and i hope he takes him up on it. >> you know, i couldn't agree with you more. i choose to believe something is going on here at the american people's request, american people's demand. i think you're exactly right. my attitude about this, peter, is, i'm wait to see.

maybe we'll all be pleasantly surprised. congressman roskam. thank you very much for your insights. krns kprns cnbc has a special report on the fiscal cliff on cnbc.com. breaking news on an iranian fighter plane attacking a u.s. drone. it happened before election day. why are we just learning about this now? today? but before we go to break, don't forget free market capitalism is the best path to prosperi prosperity. maybe there is going to be some progress in washington. i have an open mind. i'm kudlow. we'll be right back. [ female announcer ] want to spend less and retire with more?

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we are more breaking news tonight. u.s. defense officials confirm today that iranian fighter planes fired and missed at a u.s. drone. that was just days before election day. so why are we learning about it mow for the first time? joining me, syndicated radio talk show host, john bachelor. >> good evening, larry. >> good evening. they fired at one of our unmanned drones. why didn't we fire back? why didn't we take some retaliatory action? are we just patsys to the iranian air force? >> oh, larry, you said it. we're patsys to the iranian

supreme leader. this information is coming from the u.s. side. cnn reported it. it's significant to me, my information is that iran has now reported it to the iranian people. in farcesy. they reproduced the cnn report and sadded this, cnn did not sa how they recognized these were revolutionary guard fighters. >> i want to come to the quasi cover-up, whatever it was. i know it's an unmanned drone, it's our plane, it's our real estate. >> it's a predator, it's a drone. >> why don't we do something in return? that's what i'm saying. why do they feel they can do this with impunity? >> the supreme leader has the upper hand. there are secret negotiations under way between the obama administration and the supreme leader to come to a -- over the nuclear weapons cycle. iran wants the u.s. to blast its

nuclear fuel cycle as nonmilitary. iran wants lots of concessions. that's what the dohaa deal was reported in early october. the iranians took this shot. revolutionary guard corps took this shot. two fighters scrambled. they could have shot it down. they did not. more significant according to my source, tehran did not announce it. ask that question of yourself. why did tehran not take this opportunity to pop off? >> why didn't they? >> because they did not want to intervene in the re-election of president obama who's involved in secret negotiations with the supreme leader to give him everything he wants. >> this has a benghazi feel to it, john, and it's only a one-week cover-up. this has a benghazi feel to it. >> very nice, larry, but tehran is in on it this time. >> policy is falling apart. they don't want to tell anyone about it. >> tehran is in on the benghazi cover-up. two cannot dance. they chose not to dance. >> two supreme leaders here. do you seriously believe there are going to be secret talks to

stop the iranian enrichment for their nuclear weapons? you really believe this? does our supreme leader really believe it's going to have any impact? >> more, larry. there are negotiations for the president to travel to tehran in a deal much like nixon went to beijing. that is on the table. that's part of the negotiations. >> problem for tehran, i've never heard that before, john. >> it's been reported for some time. my information is consistent over a long period of time. the president has had this ambition since he first took office in 2009. he hoped to do it in february of 2012, the 40th anniversary of mr. nixon's trip. that failed and now he's looking to the spring of 2013. a handshake with the supreme leader and peace in our time. >> and we actually believe we, we, our supreme leader, actually believes that that will stop iran not only from developing nuclear weapons but also from whatever they're doing, subsidizing syria, hezbollah,

h hamas, in bed with russia. we believe they're going to come clean, straighten out, have some kind of burning bush moment. >> yes. that's the word. the obama administration believes the ambition is endorsed by the american people. they will go forward. >> what about israel in this scenario? what are they going to do as the supreme leaders meet in tehran? >> israel has confidence that iran is not fair minded and is a predator state. and, therefore, no matter how long this is dragged out, iran will get more and more concessions before it becomes impossible. for example, one of the concessions i'm told is israel wants the united states to agree that a third party killed iranian nuclear scientist. they're looking for us to endorse their law gambit against israel. they want us on their side against israel. >> boy, i think this is pretty farfetched -- >> it is. it is farfetched, larry. >> john bachelor, thank you very much, my friend. hope to see you soon on the

radio. so, folks, the stock market slump continues on wall street. since president obama was re-elected the dow's lost about 450 points. my next guest says put fiscal cliff fears to bed because a deal will be reached. here now is ken hebner of capital growth management. ken, as always, it's great to see you. all right. i'll put the fiscal cliff to bed. you see the progress going on. we just reported tonight the president's going to have a presser, statement tomorrow. john boehner has already had one. he's going to have a second one. looks like something good is going to happen. if that happens, let's put our optimistic hats on. how good would that be for stocks? >> well, we have the economy moving ahead slowly now. with an acceleration, i believe, coming from rising housing prices and rising housing starts. housing prices in this country, which have been going down for five or six years, in the last six months have started up and they're up broadry and stro rly in many markets. this is not only going to drive

housing starts higher but be a tremendous positive for consumer confidence because along with stocks, the value of people's house, the biggest asset they have. it's been under downward pressure. now it's headed the other way. >> right. i agree. this may have had an impact on the election, by the way, because it's so important to individuals. but let me just take you through this. if the so-called fiscal cliff is solved, we avoid the big year-end tax increase, ken heebner, what concerns a lot of people is that next year the capital gains tax rate is going up. the dividend tax rate is going up. as part of obama care. let alone, what may eventually happen with the bush tax cuts. do you see what i'm saying? investment tax rates are going to rise. how do you play that? how do you plan for that? or do you just walk away from it? >> well, you have to recognize that under the clinton administration, the top tax rate on high incomes was 39.6%. we had a lot of prosperity. you go back into the '60s and

'50s, the top rate on capital gains was 25% or even higher in various times. so we've had strong stock markets and a strong economy with high rates on tax -- top rates on higher incomes, a lot higher than they are now. so history would say it's not an impediment to a strong economy and a strong stock market. >> are they selling apple because they want to take capital gains before the tax goes up? >> well, the irony of it is, you normally think about at the end of the year is tax law selling. when you know the taxes are going up, the stocks, so you want to sell the stocks are the biggest losses get sold. you realize the loss. well, this year, with stocks that are up a lot become candidates for sell now and get a lower capital gains rate before the end of the year. you have tax gain selling. maybe that's going on in apple. >> all right. no doubt. let me ask you, since the election, stocks have gone down. whatever. 450-some-odd points. how far do you thing this correction goes?

and do you think it's a political correction? do you think it's a romney disappointment correction? or is there something else going on, ken? >> well, i think there's a disappointment because clearly taxes on higher incomes and on stock market investing would have been lower if romney had been elected. so coming into the election, a lot of people thought romney was going to win. so i think there was a disappointment there. but beyond that, and also there are fears of the fiscal cliff. the events you're talking about are going to dispel those fears. i think if there's -- if a real dialogue starts, that's a big positive that will offset the fears that have come up in the last two days. >> yeah, i think you're right. i mean, my political judgment for what it's worth is that they are going to postpone this fiscal cliff. and then try to work on it next year. ken heebner, you're always great, an economic optimist pip what favorite sectors are you playing? favorite sectors or stocks? >> oh, i think consumer spending

which has been a sluggish part of the economic recovery is going to accelerate because the stimulus from rising housing prices and housing starts. so retail, anything housing related. the automobile stocks benefit because pickup trucks which are by far the highest margin item in the auto company's production profiles, they rise with rising construction activity and rising housing starts. so anything in the consumer area. >> commodities have been in a slump. they're down, what, i don't know, 9%, 10%, 11%, some such. are commodities something to be avoided in your scenario? >> i don't think they lead this market as they've led past markets. the reason is this. europe, because of their problems, is going to keep declining economically for a year or two. china because they've got inflation and they've got a labor availability problem can't grow as fast as it had in the past. so the global economy is not going to grow that fast, and

what drives commodity prices up is broad rising global activity. and i think around the world the economy is going to be a lot more sluggish than it's been. >> all right. >> united states and north america are the leaders. >> we may be the leader. thank you, ken heebner, we appreciate it. while new yorkers are still spending hours on glass lines, the odd/even license plate system in new jersey which takes half the cars out of the gas lines each day, that system's working so well in new york city and the long island counties are mandating odd/even beginning friday. one more sign of sandy's impact. new york governor andrew cuomo estimates the damage in his state, alone, at $33 billion. cuomo assailed the power companies. he called for a ground-up redesign of the power and fuel supply systems. but i think what he ought to do is open the door to some deregulation and free market competition. this especially for the power

companies. let the marketplace work, governor cuomo. you'd have better results during emergencies or nonemergencies. anyway, coming up here, president obama wasn't the only big winner on tuesday night. the polling industry kind of nailed it. top pollster ed gullas is up next. ♪

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pollsters. the preelection polling average showed obama leading nationally 49%-48%. get this. final election tally, obama 50% versus romney 48%. pretty good. despite the talk of skewed polls, proved to be pretty darn accurate. here to help explain well, pollster, mr. goeas. ed, i spoke to you tuesday evening or something. you had it pretty close, too. i mean, why this time around? there was so much debate, you know, this and that, and the democratic samples were going to be bad, and the latino samples were going to be bad and all the samples were going to be bad. turns out it wasn't bad at all. >> that wasn't the case really in the national polls. most of the national polls looking at the whole picture, they always kind of come back to fairly close together. and if you look at the top ten polls, actually the top 15 polls, all of them within the margin of error and very, very close. i think most of the back and

forth was more in the state polls, kind of arguing over, was it going to be census data, or exit poll data from 2008 or 2004? interestingly enough, of the eight battleground states you could look at with exit polling from the two years, four of the states were more democratic this time than they were four years ago and four were less democratic. so probably the average between the two was probably what to look at. >> all right. let me just go, it's very interesting, everybody did pretty well. just a second, the business of polling, ed. i don't think people really get into this. first of all, what are there, 25, 30 polling companies? is that about right? >> in terms of kind of involved in the national polling, that's about right. >> all right. so who pays for these polls? are they free? are they a public service? how does that work? who's paying for the polls? >> most of them are paid by media swrooutlets. in the case of my battleground

to, i do with pollsters, we have two sponsors, one is politico and one is george washington university. it's always nice to have the academic connection in terms of them kind of overseeing, working with us in terms of sample. >> but if i may, do they compensate you for those polls? >> no. it's pretty much break-even for all three parties. they cover the cost. we get in the field to do the surveys. and we get a great dell of attention for doing it. >> all right. that's just where i was going. you get a lot of attention, get lots of publicity, become a very famous guy. everybody wants to talk to ed goeas because his polling is so good. now, do you in this business -- look, i'm a free market capitalist. i'm in favor of this. do you take that good publicity and use it for private good paying -- i don't know what they're companies, you know, consumer branding companies or investors, whatever. is that how the game works? sort of parlay your fame as a presidential political pollster into these free market private firms? >> no. as a political pollster, our

win/loss record is more important. it's what races are you winning, which races are you losing and how right is your data? what i do, and other people may do it differently, what i do with our national data that i do with g.w. university and with politico is i have over 100 -- there were over 100 races we were working with congressional, senate, presidential, and then that data is shared once it's public with them to help them kind of understand the political environment, what they're facing, what is happening beyond just their own individual races. >> well, so, you don't, then, go into the corporate world? is that what you're telling me? >> i don't. we are very, very focused on, you know, we're very good at campaigns. we're very good at winning campaigns. that's where we keep our focus. it's not about money. it's more about we're a republican firm that work with republican candidates. >> all right. well, there's nothing wrong with money in my world. let me just ask you, don't some of your colleagues, you know, take this political prestige, i'm going to call it, and put it to work with private

corporations? >> they do. and it's what you're all about. i mean, we -- our company has been around for 35 years. the -- my partners and i used to work for the party. and way wa and we wanted to keep working campaigns and we'll do it for i believe several decades more. different people have different focuses. you know, i've worked in campaigns ever since i was a kid, and plan on working on campaigns until i retire. >> all right. many thanks. ed goeas. one of the ace pollsters in this country. cominge ining up on the sho president obama's win on election day raises big questions about the future of the republican party. that one's coming up next. ♪ [ female announcer ] today, it's not just about who lives in the white house, it's about who lives in the yellow house, the green, and the apartment house, too. today we not only honor the oval office,

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welcome back to "the kudlow report." so the republican party just suffered its second straight loss to barack obama. even lost ground to senate democrats. amidst all the disappointment i think the real question is, what does the gop stand for? and where does the party go from here? so let's talk. we have cnbc contributor, jim of the american enterprise institute. jennifer ruben, author of

"washington post" right turn blog. and strategist ed rogers. there's a lot of answers to this. i want to say one thing. republicans ought to stick to their economic free market principles. tax reform, entitlement reform and so forth. don't sound like democrats. whatever. stay like republicans. they believe in markets, not big government. >> they should believe in markets and not big government. they also should not believe in crony capitalism. you know, there's been a lot of talk that they need to, you know, reach out more to hispanics, to asians. absolutely they do. but i would not begin to treat them as sort of interest group politics. i would appeal to hispanics and asians just like i would appeal to a working class white voters. they're taxpayers. mitt romney had a tax plan which i think the average taxpayer never quite understood how it was going to affect them. i blogged, again, about this today. if you went to mitt romney's

website with a tax calculator, didn't exist. you had no idea how his tax plan was going to affect you. >> you know, jennifer ruben, i also believe the republican party has just got to be the party of inclusion. my mentor, formally, the late great jack kent. the party of opportunity. the party of inclusion. the party welcoming people. and i am specifically thinking about the latino, hispanic problem. i'm also thinking about the asian problem. i'm also thinking about the african-american problem. jen, if republican presidential candidates continue to lose 70% of the latino vote, for example, we will never elect another republican president in my lifetime. >> that's right. it might work in an off-year election when the electoral is whiter, older, more economically sophisticated. but in a broad-base election, where we're going out to the entire country, the white voting section of the electorate is down to 72%. george bush in 1992, george bush

41, had 87%. we cannot win broad-based big elections in presidential election years only appealing to a smaller and smaller segment of the electorate. so i think that means candidates who can relate to people from all different communities. it means going into those communities on a sustained basis. not simply at election time. and it means, frankly, getting our act together in immigration. i would point out two things today -- >> immigration? really important. immigration. i want to stay on that point. this is so important to me, jennifer. i guess maybe i'm a liberal on immigration. but to me -- >> i'm a communist. there you go. >> to me, the republican party, this whole idea of self-deportation, i'm not going to pick on mitt romney. he did what he did. he ran a race. i'm just saying, self-deportation, huh? that sounded so bad. a lot of this stuff coming out of arizona sounds so bad. the intent may be good, but the actual stuff sends all the wrong signals and it's not only for latinos and -- it's for asians, too, jennifer.

i just -- before i get to ed rogers. it's for asians. it's for african-american. the gop must be a party of opportunity and prosperity and growth for all these groups. with welcoming committees. that's what's missing here. >> absolutely. these are people who believe in the american dream. they belief what we do. i was encouraged by three things. one, i think marco rubio is going to play a big role together with jeff flake who's been a proponent of immigration reform. secondly, we had sean hannity, a very prominent talk show host on a different network but also a radio, who says i've evolved, i'm looking for now a pathway to citizenship. big movement out there in the grassroots. >> right, that's key. >> third, we saw john boehner today say, yes, he's in favor of moving ahead on immigration reform. >> finally. >> we should make this our issue, the republicans' issue. leapfrog the president. don't wait for him to put something on the fable. they want on issue, want a fight, we want a solution. >> ed rogers, you've been around a lot of these campaigns. what i'm asking for is a freedom

agenda. a freedom and reform agenda for the republican party. regarding economics and also regarding what i'll call social issues or cultural issues. i don't want to see them as individual interest groups. these are human beings. small businesspeople. churchgoing people. this is what's missing. i fear, i fear it's gotten worse in the last couple years. >> well, my old boss, one of my old bosses, lee altwater said the republican party needs to be a big tent. he coined that phrase. and lee meant that on social issues. on economic issues, we don't need to "me too" the democrats. if people are now voting themselves benefits and a lifestyle from the federal treasury, republican party shouldn't "me too" the democrats on that. we need to stay the party of low taxes, smaller government, more freedom, individual responsibility. on social issues, we can't nominate wacky people that

marginalize the republican party the way the democrats want us to. we need to be a big tent, as lee atwater said and as jack kemp agreed with. >> listen, reagan taught me that stuff, too. reagan welcomed -- as a former governor of california, he welcomed the various immigrant groups coming in. >> always. >> jimmy, you're going to have a test now with this fiscal cliff business. will the republican leadership stay true to their economic principles, namely limited government, lower spending, low tax rate reform, et cetera, et cetera? or are they going to sound like democrats? in other words, everybody wants a deal, jimmy, but a bad deal be a bad idea. >> we have an economy which is not particularly strong. the last thing it needs is a bunch of tax hikes. i was heartened that speaker boehner said he was against raising marginal tax rate. there's other ways you can get revenue, whether through growth,

getting rid of crony capitalist tax deductions. i think that's a great place to draw a line in the sand. >> we can't cave on -- >> jennifer ruben, you're not so much the economist. how do we right now, how does the gop get off to a better start on attracting a more inclusive party? what ed rodgers called a big tent. i rather like that notion of a big tent. not all conservatives do. darn it, i'm a conservative. conservatives should be a big tent regarding latinos and hispanics, for example. where can we start? right away. right now. >> one, immigration reform, and two, start explaining how our policies actually work. when you and i say free market capitalism, we know what that means. people in a wide array of situations, social, economic, ethnic, have no idea what we're talking about. it's going over their heads. we have to explain this is going to put x. amount of dollars take-home pay, larry. that's the phrase. >> right. >> we have to explain what low

regulation means for the guy who owns the cleaning store. we have to explain what the debt does to our kids and our grandkids. $16 trillion, people don't understand. they do understand $50,000 per kid per person in america. >> that's right. listen, latinos and asians, particularly, are known for their business acumen. >> no question. they're for that. >> why don't we tap into that? i got to get out of here. ed rodgers, i'll give you the last word. why aren't we tapping into that instead of keeping them out, instead of self-deportation, instead of all this border stuff. why don't we say, we welcome you into the pro-business, free market, republican tent? >> prosper with us. >> prosper. >> we need to start with an intellectually honest position. we need to say, we're not going to deport 11 million -- >> right. >> -- illegal aliens because we're not going to. we're not going to deport the

population -- since it's not going to happen, let's say so. let's start from an intellectually honest position. >> just say that. that's right. that's a good place to start. there is not going to be deportation. there will be a process for legalization, to english, american history. >> let's do it right. >> we can do this stuff. it ain't that hard. and a few bad apples are holding up the gop on this. not you guys. jimmy, jennifer, and ed rodgers. thank you very much. coming up, huge news in the fight against cancer. if you have a family history of cancer, you can't miss this. the full story coming up next. [ female announcer ] e-trade technology

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welcome back to "the kudlow report." colorado and washington state made history on tuesday. becoming the first states to legalize the recreational use of marijuana. i just want to ask if liberals trounced on american values and by the way, productivity also? joining us to talk about this, syndicated radio host, founder of constituting america, janine turner. janine, great to see you again. okay, so, i want to ask you a bunch of things here. first of all, with all the problems america has, why is it so important, why are the liber liberals, lefties crusading like crazy to legalize marijuana? what is this about? >> it's disappointing. it's stealing the promise of americans, the future of america. not only that, our children and our youth. you know, obviously children. they'll have to be 18 or 21 or whatever. our youth, it's going to permeate into the high schools and i think it's very disappointing. i agree, larry, there are so many, so many issues to be

worried about. >> there's going to be a legal debate about this at the department of justice and d.e.a. and so forth. this doesn't go into place for a year or more. i'm not interested in the legal side. for one thing, is this a little too much freedom? that's what i want to know. freedom is great. is this too much freedom? the kind of freedom that might hurt this country? >> well, i think we look at alcohol, i think alcohol, you know, hurts a lot of people. we have a lot of problems with alcoholism. and i'm 26 years sober myself. i know the family disease. i know what the disease is like. and i see so much of our youth dying from alcoholism and prescription drugs and marijuana is that gateway drug. where it's been proven that it lowers everybody's inhibitions. alcohol, too, for that matter. we're talking about marijuana. then they go and try prescription drugs and they're dying. i mean, it's very, very unfortunate and frightening. >> okay. you got me beat. i'm 17 years clean and sober. that's great, okay? >> okay. one day at a time.

>> i go to plenty of 12 step meetings. believe me. it's what keeps me at least relatively sane. >> good for you. >> you hear the stories of these young kids coming into the rooms and a lot of them, so many of them start with marijuana when they're in junior high school. okay? and then they graduate, as you said, to stronger and tougher drugs over a period of time. i just -- i just don't know why this is so important. there's so much evidence on that point. i'm not trying to deprive people of their freedom. it just seems so obvious to me and i don't understand why the left is crusading. is there a hidden agenda? are they trying to weaken america? are they trying to screw up our workforce? what's going on here? >> i don't know, but i agree with you. one, it will be interesting to see what eric holder does. it's federally still illegal to legalize marijuana, so what's going to happen -- what's eric going to do, mr. holder? is he going to sit back and turn a blind eye to it? or like he certainly didn't do that with arizona. i don't know what the liberals are doing.

i think the whole country, we're in dire straits now. we need to buckle our seat belts and get ready for what's going to happen to our country. >> does this become a social and moral issue? i mean, drugs, it's a moral issue. drugs, they don't do drugs in asia. you get your hands chopped off or your heads cut off or whatever. why america? that's what they do in europe. why do we have to do this? >> i agree with you, larry. the thing is, it steals the promise of an individual. it limits their sinki ithinking motivation. going to endanger other people when they get behind a car. it's opening this huge, huge lion's den of problems. i think it's very unfortunate. of course, i think states, you know, have a right to do what they want to do. but isn't it ironic, of course, the federal has an aspect of this whole marijuana issue, but isn't it ironic they want to -- the liberals want to tell our schoolchildren how many calories they can have at lunch yet go ahead and smoke marijuana? there doesn't seem to be any reason -- >> that's exactly right.

that's one of the more bizarre things. we have that in new york with mayor bloomberg. >> no big gulps. >> no french fries. what kind of slurpees you're allowed to have or not have. >> but go smoke pot. >> go ahead and have a joint, go ahead and have a couple joints and let the joints lead to worse stuff. that's the part that blows me away. i'm missing something here. i don't want to be a killjoy. i believe in freedom, live and let live. this to me goes too far. >> i think it goes too far, and i think that people aren't thinking about the youth, especially. and think about christmas and alcohol's permeated everything now. whether it's happy times, sad times. what about teaching our kids coping skills? now you walk in and say, hey, here, have a joint, you'll feel a lot better. what kind of coping skill is that to teach our children? our children need to have a lot more sobriety than that. >> janine turner, talk about sobriety. i love to hear what you told me. i'm glad we could share on "the kudlow report." >> yeah. >> you are terrific. that's it for tonight's show. i just love that.

maybe one of these days we'll do a qualification right on the show. thanks for watching. i'm larry kudlow, sober at a church mouse, and i thank god for it. customer erin swenson bought from us online today.

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